How to use Loan Calculator
- Enter the amount borrowed and the annual interest rate.
- Enter the loan term in years or months; the term must cover whole months.
- Read the monthly payment and totals. Expand the payment breakdown to follow the remaining balance.
A closer look
This calculator models a fixed-rate loan repaid by equal monthly payments at the end of each month. It divides the annual nominal interest rate by 12, then calculates payment = P × i ÷ (1 − (1 + i)⁻ᴺ), where P is the amount borrowed, i is the monthly rate, and N is the number of payments. At zero interest, payment is simply P ÷ N. A 1,200 loan over 12 months at 0% therefore costs 100 per month.
A practical example
A loan of 1,200 repaid over one year at 0% costs 100 each month under this model. Add interest to compare the payment and total repayment.
A useful tip
Use the contractual interest rate rather than an APR that includes fees. This estimate excludes fees, insurance, taxes, early payments, and changing rates. Lenders can use different rounding and day-count rules.
Good questions. Simple answers.
Why does interest fall through the schedule?
Interest is calculated on the remaining balance. As principal is repaid, the balance falls and more of the payment goes toward principal.
Does the currency selector convert exchange rates?
No. It only formats the entered amounts. Use one currency throughout. The schedule keeps full calculation precision and rounds displayed amounts.
Explore all calculators for related tasks and category-specific guidance, or read how Toolzafi handles your data.